GIPE Newsletter 9 May 2024

PURCHASE OF PROPERTY:

MAKE THE DEPOSITE CONDITIONAL ON OBTAINING FINANCING

The seller of a home and the buyer agreed to a deposit that specified that the buyer would not lose the money given if she was unable to obtain financing for the purchase. However, when the buyer demanded the return of the deposit due to not obtaining financing, the court ruled in favor of the seller.

The decision was based on the buyer only obtaining financing for 80% of the appraised value of the home, which is common practice. The court argued that the buyer should have specified in the earnest money contract that she needed financing for 100% of the appraised value if that was her requirement. In addition, he pointed out that the escape clauses for not obtaining financing are exceptions to the legal regime of deposits and must be interpreted strictly.

In conclusion, the court determined that when making deposits conditional on obtaining financing, it must be clearly specified when financing is considered to have been denied.

THERE IS A PREVENTIVE SEIZURE ANNOTATION

If you discover a preventive seizure annotation on a property you want to buy, you can act safely by following these steps:

1. Request a load certification to obtain detailed information about the existing loads on the property and confirm their validity.
2. If the operation is viable, negotiate with the owner to retain from the sales price the amounts necessary to cover existing charges.
3. Contact the creditor, whose details will appear on the certification, explain the situation and coordinate their appearance on the day of the sale.
4. Prepare the deed by going to the notary: the owner to transmit and receive part of the price, the creditor to receive payment and state in the deed that it is settled, and you to acquire the property and make the necessary payments.
   

COMMUNITY OF OWNERS:

DIFFERENCES BETWEEN VACATION AND TOURIST RENTALS

Below are the differences between tourist rentals and vacation rentals, focusing on their characteristics, regulations and the requirements to prohibit them in a community of owners.

• Tourist Rental: It is defined as the temporary transfer of a furnished home for immediate use, with advertising on tourist channels, for profit and subject to specific regulation. To prohibit it, an agreement of 3/5 of the owners representing three-fifths of the quotas is needed.
  
• Vacation Rental: Refers to the temporary transfer of a home without being fully furnished, without specific advertising and without the need for lucrative purposes. Its regulation is governed by the LAU and to prohibit it, unanimity of the owners is required.
  

DOES IT AFFECT THE EXTERIOR CONFIGURATION?

The rules and procedures related to works that affect the exterior configuration of a building in a community of owners are the following:

Permitted Modifications: Owners may make modifications within their own units as long as they do not affect the security, general structure, exterior configuration or condition of the building or harm other neighbors.

Community authorization: Works that affect common elements or the exterior configuration of the building require community authorization, unless explicitly permitted in the statutes.

Definition of exterior configuration: Includes the appearance of the building from both the exterior and interior, encompassing the shape, color, materials and occupation of the space.

Examples of alterations: Installations on the facade, changes in materials or colors, modifications to spaces such as windows or terraces.

Requirements for community agreement: Works that permanently affect the building and modify the constitutive title require unanimity, while others may require a qualified majority of 3/5 of the owners and quotas or even a simple majority, depending on the type of work and the specific circumstances.

In summary, any work that alters the external appearance of the building requires community authorization, with flexibility in agreement requirements depending on the nature of the work and judicial interpretation.

I WANT A CHARGING POINT

An owner asked the neighborhood community for permission to install a charging point for his electric vehicle. According to the law, prior communication to the community is only required for this type of work, but if it involves altering common elements, it must be authorized by the community. In this case, the installation required crossing the building’s floors. The community is obliged to allow the installation, but it was determined that a prior project and building permit would be required, instead of being granted as the owner wanted.